Ketchikan, all-American city, rises again

Posted: Sunday, July 17, 2005

By LEW M. WILLIAMS JR.KETCHIKAN DAILY NEWS

Ketchikan won the National Municipal League's All American City designation in 1957. It was for a decade of community activism that brought Alaska a year-round industry, the $54 million Ketchikan Pulp Company mill, and for community improvements: expanding hydroelectric power, utilities, schools, harbors and streets. Mayor Joe Goding complimented the people of Ketchikan for planning and for approving $12.9 million in bonds to pay for the improvements.

Ketchikan could win another national award in 2007 for a decade of rebuilding its community after the timber industry collapsed when the pulp mill closed in 1997.

Ketchikan City Council last week approved long term tax and power incentives for the state-owned Ketchikan Shipyard. The borough assembly granted tax incentives earlier. That means the state's Alaska Industrial Development and Export Authority makes $14 million available immediately for construction of a second ship lift, more than doubling the yard's capacity.

Also, U.S. Rep. Don Young has $50 million in a pending bill to complete the shipyard. That is $64 million to create a facility capable of employing up to 300 people in high paying maritime jobs serving Alaska's maritime industry.

A few days before the council's action on power rates, the Bonneville Power Administration granted special discount rates to three aluminum smelters and a paper mill in the Pacific Northwest to "keep important jobs in the region." The shipyard's new rate puts it on a par with other Northwest shipyards. For a precedent, the pulp mill was granted a 10-year waiver of property taxes when established. And, before oil, it contributed 20 percent of the corporate income taxes collected by the then territory.

The agreement with the shipyard was the first of three steps Ketchikan must take to boost its economy to All American status.

The next step comes Aug. 16 when city of Ketchikan voters will be asked to approve $70 million in bonds (equivalent to $12.9 million 55 years ago?) for a fourth berth in the harbor, and for upgrading existing berths and upland areas to support the cruise industry. The outstanding feature is that unlike other proposals to tax the cruise ships just because they are here, Ketchikan officials sat down with representatives of the cruise industry to see what the industry needed, agreed upon a design and reached an agreement on how to pay for it. The city sells the bonds, with voter approval, but the industry pays them off. No obligation for local taxpayers. Actually, local taxpayers benefit from increased sales tax revenue from additional visitors staying in port longer because of expanded facilities.

Hmmm, $64 million plus $70 million. Now we are talking real money. That's two down, the shipyard and the harbor.

The third needed improvement is completion of the Swan Lake-Tyee Lake Intertie. Ketchikan needs the power for its expanding industries: the shipyard, the hospital, tourism and hopefully timber again with a veneer mill and Pacific Log and Lumber's Gravina sawmill and dry kiln. Gov. Frank Murkowski's administration is cooperating by making state timber available to supplement national forest timber, much of which is held up by litigation.

The energy committee of the Southeast Conference, an organization of all Southeast Alaska communities, noted at a meeting last week: "The Swan Lake-Tyee project is a key element in the SE Alaska Electrical Intertie grid. Building the Swan Lake-Tyee link and the section from Kake to Petersburg builds the grid to the mid-point of SE Alaska."

Goal of the conference is a hydroelectric power grid removing Panhandle communities from dependence from high priced diesel fuel.

While construction on the Swan Lake-Tyee Lake Intertie is stalled, a 9.7-mile underwater power cable will be laid in September to carry hydroelectric power to the Greens Creek Mine on Admiralty Island and on to Hoonah.

Which brings us to the sleeping giant in Southeast: mining.

If Southeast can provide the power, mining could bring additional high paying jobs to the region. Of course we also need low cost access - roads and airport access. But that is another column.